'Opportunity' is a central concept in entrepreneurship research, and this Article explores the relationship between law and entrepreneurial opportunities. We adopt the widely held view that entrepreneurial opportunities are ideas created by entrepreneurs, rather than resources waiting to be...

New ventures are inherently cash-strapped. The founders who start them are typically doers — problem-identifiers and solvers who are great at finding ways to get things done within given constraints. For most entrepreneurs, the legal formalities associated with new ventures are a low priority...

Studying the creation of venture boards in a hand-collected sample of 296 VC investment rounds in 132 German high-tech ventures, we find that risk exposure and investor syndication are strong predictors of whether a formal board is created or not. Our setup allows to study the creation of the...

In January 2012, amendments to California's corporate code permitted a new type of corporate form designed around for-profit entities also wishing to commit to serving a broader “social purpose” (or purposes). Although not the first state to embrace such reforms, California's experiment is...

In the bank-borrower setting, a firm's existing lender may exploit its positional advantage to extract rents from the firm in subsequent financings. Analogously, a startup's existing venture capital investors (VCs) may dilute the founder through a follow-on financing from these same VCs (an...

In his book, 'Boulevard of Broken Dreams: Why Public Efforts to Boost Entrepreneurship and Venture Capital Have Failed - and What to Do about It,' Harvard Business School Professor, Josh Lerner, explains that governments can only play a limited role in spurring innovation and entrepreneurship....

Contracts between parties who have an on-going relationship often rely on informal norms, rather than formal legal rights, to resolve disputes and reduce transaction costs. Investors financing startup firms, however, may need to look outside of their existing network to find an entrepreneur with...

Fueled in part by the wealth recently created from digital currencies, major art dealers such as Christie’s and Sotheby’s have embraced the sale of non-fungible tokens attached to unique digital works of art. What are non-fungible tokens, how is this related to the blockchain and what do we...

We investigate entry in a dynastic entrepreneurship (overlapping generations) environment created by employee spinoffs. Without finance constraints, enforcement of non-compete agreements unambiguously improves social welfare outcomes, and even increases the rate of spinoffs from original firms....

This paper develops a theory of contracting among founders of a new firm. It asks at what stage founders agree to commit to each other, how they structure optimal founder contracts, and how this affects team formation, ownership, incentives, and performance. The paper derives a trade-off between...